Have We Seen the Bottom for Inflation?
That depend. on what? On the length of this strike. consumer demand is well past peak, so there is no longer a certain level of pent-up post-pandemic, revenge type consumer activity. I think that if this strike goes, for more than a few days, there will likely have to be at least an increase at a minimum...in producer prices. I had expected consumer prices to start working their way higher as we head into late 2024 anyway. I have not chnaged that view.
On that matter, Chicago Fed Pres. Austan Goolsbee commented, "Anything that's a negative supply shock, in our language, that's going to raise the cost of doing business and lead to shortages, is something that we're just going to have to deal with and the impacts are never good."
Yes, thank you, Captain Obvious.
That said, the Fed's 50-basis point rate cut, and the potential for another 50 to 75-basis points worth of rate cuts this year (understanding that there will as always be a lag in feeling the impacts of changes made to monetary policy) certainly won't pressure consumer inflation. Neither will this dock strike. Should this strike stretch into a second week and beyond, I would think that then... consumers will start to feel something.
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NYSE floor trader for over 30 years. Day trader, long-term investor, and anything in between.
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Dan’l : Powell’s unjustifiable timing (according to their own reasoning) smells like political motivation, even if their too-little-too-late approach accidentally lands.
In regard to these strikes? Biden (or Jill, Hunter, et al.) has the ability to compel all parties to continue negotiations, and if not for their fears that these corrupt relationships with unions might wind up biting Kamala in the Walz? They’d do it.
(And, no, I don’t mind saying so. ~;-)